AIP takes over Sanjeev Gupta’s Dunkirk aluminium smelter

The American private equity firm that invests in industrial businesses, American Industrial Partners (AIP) claimed to have grabbed control of distressed metal magnate Sanjeev Gupta’s Dunkirk aluminium smelter in France.

On 1st October 2021, American Industrial Partners stated that it had acquired the Alvance smelter in Dunkirk and two other French establishments following Sanjeev Gupta chaired GFG Alliance failed to make payments on outstanding loans. However,  in 2021, AIP bought up a portion of the debt at Europe’s largest aluminium smelter, Dunkirk, as well as at an associated mill in Belgium.

Sanjeev Gupta anticipated securing a rescue loan with Anglo-Swiss multinational commodity trader Glencore, which had propounded to refinance the debt across his European aluminium business. The Dunkirk aluminium smelter produces 280,000 tonnes of metal per year.

GFG said: “The group will defend its position and its interests vigorously.”

The group also complained in regards to its offerings to repay AIP debt via a committed third-party lender only for the private equity firm to utilize its ‘loan to own model’ to mastermind an asset buyout for that is decumbent of market value.

The mislaying of the French smelter would be a big setback for Sanjeev Gupta who has been floundering to safeguard his metals and mining corporation following the fall-out of his principal lender in March. Now, with the price of aluminium trading 13 years high, the smelter will have produced a profitable source of income.

The Chairman of the GFG Alliance is already in discussions for broad refinancing deals for his remaining establishments, incorporating in Australia and the UK.

In May 2021, the Serious Fraud Office of Britain announced that it was investigating GFG and its relationship with Greensill.